2.3.5. System Boundaries

The boundaries that are set in defining LULUCF activities and projects can
greatly influence the credit attributed to an activity and its true value in
avoiding dangerous levels of GHGs in the atmosphere. Boundaries and other aspects
of carbon accounting can affect decisions on allocating global warming mitigation
funds between the energy and LULUCF sectors, as well as among different types
of activities within the LULUCF sector.

2.3.5.1. Carbon Pools

One issue is defining which system components are included in the analyses.
If system boundaries were defined to exclude some pools, there would be a risk
of outcomes in which activities receive carbon credit when they actually result
in net emissions. If one considers only the soil component, for example, converting
forests or poorly managed pastures to well-managed pastures could increase carbon
storage in Amazonian soils (e.g., Cerri et al., 1996; Batjes and Sombroek,
1997). Forest conversions, however, lead to losses of carbon from biomass that
much more than offset any potential gains in the soil. The same consideration
applies to the question of whether conversion of natural savannas to improved
pastures increases carbon stocks (Fisher et al., 1994) or decreases them
(Nepstad et al., 1995).

Even within the soil sphere, the predominant pasture management system in Amazonia
today results in substantial losses of soil carbon (Fearnside and Barbosa, 1998).
In addition, if deep soil (below 1-m depth) is included in analyses and a long
time horizon is considered, pasture can result in large emissions of soil carbon
even if the stock in the surface soil has increased because trees have much
deeper roots than pasture grasses: Some tree roots penetrate more than 8 m (Nepstad
et al., 1994). Roots supply carbon to the soil through exudates and root
death (turnover); when deep-rooted trees are removed, the soil-carbon equilibrium
in the deep soil shifts to a lower level over a period of decades (Trumbore
et al., 1995).

The question of whether subsidizing improved pasture management in Amazonia
would result in carbon benefits is very important. Although some observers maintain
that ranchers switching to improved pasture management will slow their rates
of forest clearance (Faminow, 1998), evidence reviewed by Fearnside (1999a)
indicates that increased capital supply to ranchers (from subsidies and from
more profitable pastures) would have the opposite effect on deforestation. Although
the impetus for the expansion of cattle ranching in Brazilian Amazonia currently
comes largely from profit sources other than sale of beef (Fearnside, 2000a),
saturation of the beef market will eventually reduce beef prices and contribute
to limiting further deforestation for pasture. The possibility that this effect
could form the basis of a cost-effective strategy for global warming mitigation
has been questioned, however (Fearnside, 2000a).